What’s happening with the NQ futures market?

A tremendous amount of movement is happening within the Nasdaq futures market (NQ). Right now, it appears that the ongoing problems with the Colonial pipeline could be impacting the market. Transportation and oil companies are getting hit hard right now due to the pipeline shutting down, and that’s causing prices to plummet.

Based on our analysis, the long-term direction for the NQ is still up, but the short-term is down as this sell-off continues. The price in the one-hour timeline is in the sell zone and continues to drop. The price rebounding, if the pipeline shutdown indeed caused the sell-off, is dependent on the pipeline becoming operational again. This is one of those situations where extraordinary circumstances are having an impact on market prices.

And it’s this kind of scenario where following our timeframe analysis is extremely important. Remember that our daily timeframe helps us find the high and low price of a market, while the one-hour allows us to establish our buy-in strategyWhen we have a sudden shift in the market’s movement, our timeframe charts allow us to see it with more clarity. 

Now, let’s look at our timeframe charts to see what’s happening with the NQ:

Daily Timeframe Analysis

The daily timeframe is showing us that the NQ price has broken the outer trend line and is headed for the inner trend line. If you pair that information with our Fibonacci, that means the price is dropping toward 12958.50.

Chart the channel

Though there’s a sell-off happening, the overall direction for the daily timeframe is still up. The price is headed toward support (lower grey line) and will likely U-turn toward a new rally (long green arrow).

I expect the market to fall toward support (the lower grey line) and then U-turn toward a new bullish rally. If that support holds, the overall direction will remain up. Remember that this drop is most likely caused by a random disruption in the market (the pipeline shutdown), so we shouldn’t expect this sell-off to continue for too long once everything goes back to normal. Now let’s look at the one-hour timeframe analysis…

One-Hour Timeframe Analysis

As we mentioned before, there’s a lot of downward movement within the NQ one-hour timeframe. We’re in the middle of a big sell-off, most likely due to the current issues with the Colonial pipeline.

The price is well into the sell zone, as you can see in the chart below. Transportation and energy companies are getting hit hard by the pipeline shutdown, which is disrupting a lot of businesses. That has investors nervous, causing them to spark a sell-off.

Chart the channel

We can see the price dropping significantly in the NQ one-hour timeframe. It’s pushed passed support (bottom grey line) and continues to go lower. We’ll have to wait for the drop to hit a new level of support and U-turn.

While this sell-off looks intimidating, it should be temporary. We have to wait for the pipeline problems to resolve and the impacted sectors to recover. Then the price should rebound and get back into the buy zone!

The Bottom Line

While this sell-off looks intimidating, it should be temporary. We have to wait for the pipeline problems to resolve and the impacted sectors to recover. Then the price should rebound and get back into the buy zone!

The Bottom Line

We’re waiting for the NQ to rebound and get back into the buy zone

The NQ is currently experiencing a sell-off thanks to forces beyond our control. This is just one of the situations where you have to wait for things to get back to normal so we can get back into trading the market. Unless something prevents the Colonial pipeline from opening up, we should see the NQ rebound and get right back into a positive bullish rally. To learn more about how I come up with my analysis, check out this information on my strategy here!

Keep On Trading,

Mindset Advantage: Balance

When it comes to your mindset for trading, you’ll find that your ability to cope with the markets, bad trades, good trades – whatever – has more to do with how you spend your time outside of trading. More specifically, how much balance you have.

 In fact, of your total state of readiness 10% may have to do with charts and price levels. The other 90% has to do with how rested you are. How focused you are. How happy you are.

Find a balance that works for you and begin the path towards happy trading.

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Josh Martinez

Josh Martinez

Josh Martinez is an elite Analyst who’s been actively trading the financial markets since 2011. He’s known as one the leading innovative traders in this industry due to his his cutting-edge strategies.

Josh first burst into the scene when he took an initial deposit investment of $500 and turned into over $39,000 in just under 2 years.
Josh’s trading articles have been featured in Your Trading Edge, The FX Street, Trader Planet, Forex Crunch, Trading Pub, and Equities.com.

In addition to trading, Joshua has also trained thousands of traders worldwide. His strategies and systems have helped others find success in the market

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